Golden Harvest Agro Industries Puny – one of many main frozen food and ice cream sellers in the nation – is dealing with a excessive obligation risk, with its financial institution loans amounting to 71% of shareholders’ fairness.
SF Ahmed & Co stated in an audit report for the fiscal 2023-24 that the company’s working capital change into primarily sourced from quick financial institution loans.
All these loans are passion-bearing, which manner any upward adjustments in passion charges may possibly possibly per chance furthermore adversely own an trace on the company’s ability to carrier its loans, it added.
The auditor cautioned the company in regards to the functionality consequences of non-cost, urging the management to rob into narrative the dangers enthusiastic.
Based on its financial observation, the total long-timeframe and quick loans of Golden Harvest Agro stood at Tk190.43 crore, which accounts for 71% of shareholders’ fairness.
The passion cost on these loans amounted to Tk12.90 crore in FY24, representing 36% of the company’s total charges. This signifies that a vital share of the total charges is devoted to passion funds, the auditor observed in the report.
A senior officer of the company, talking to The Industry Customary on condition of anonymity, stated the company has struggled since 2019, primarily attributable to the impact of the Covid-19 pandemic and ongoing financial challenges. The rising passion charges own extra worsened the company’s difficulties.
The officer added that the enterprise has been on a downward trend in newest years, ensuing in debt charges accounting for the next proportion of the company’s total charges. No matter these challenges, the company has managed to lead certain of mortgage defaults and continues to pay dividends to its traders.
In 2013, Golden Harvest raised Tk75 crore by issuing shares at Tk25 every, collectively with a premium of Tk15. Of this quantity, Tk33.84 crore change into ancient to repay loans, whereas the the rest change into allocated for enterprise growth and the institution of an ice cream manufacturing facility.
Controversial folks sold placement shares of Golden Harvest. Based on the company’s IPO prospectus, considerable placement shareholders incorporated Anisuzzaman Chowdhury, a extinct director of United Industrial Monetary institution; Zahid Maleque, a extinct minister of the ousted Awami League authorities; Matiur Rahman, a extinct member of the National Board of Income (NBR); and Peoples Leasing.
Later, in 2019, the company raised Tk89.93 crore by issuing lawful shares, of which Tk29.97 crore change into ancient to repay loans.
On Wednesday, its shares closed at Tk10.10, a 2.91% decline from the previous session.
Resulting from the enterprise deterioration, the company’s dividend payout dropped to most moving 2% income FY24, when put next with 7% money and 5% stock in FY19.
United states of americaand downs
Sooner than its stock market itemizing in 2013, the company had demonstrated promising enterprise performance. In June 2011, its income stood at Tk52.65 crore, with a web income after tax of Tk13.23 crore.
Six years later, its income surged to Tk224 crore, and its web income reached Tk24.28 crore, marking the most moving 365 days in Golden Harvest’s enterprise historical past.
In 2018, the company applied to rep 22 situation rights shares to elongate its enterprise and bought BSEC approval in October 2019.
Alternatively, after the usage of the funds raised from the rights shares, every its income and web income began to decline.
For the length of the 2020-21 and 2021-22 fiscal years, the company’s income dropped greatly, and it incurred sizable losses, depriving commonplace traders of their anticipated returns. No dividend change into instructed for FY20.
In FY23, the company managed to post a income, however in the next 365 days, it reported a loss of Tk20.72 crore. Its income for the final fiscal 365 days stood at Tk91 crore.
In the July-September quarter of FY25, the company’s income dropped by 28% to Tk20.59 crore, with a loss of Tk1.97 crore.
As of the shatter of September, its web asset stamp per share stood at Tk12.76, down from Tk13.41 at the identical time the previous 365 days.
